Capital Employed

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DEFINITION of 'Capital Employed'

1. The total amount of capital used for the acquisition of profits.

2. The value of all the assets employed in a business.

3. Fixed assets plus working capital.

4. Total assets less current liabilities.

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BREAKING DOWN 'Capital Employed'

This is a term that is frequently used, but very difficult to define because there are so many contexts it can be used in. All definitions generally refer to the investment required for a business to function. By "employing capital" you are making an investment.

Also known as "funds employed".

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RELATED FAQS
  1. As an investor in stock, how should I evaluate a company's capital employed?

    Before you evaluate a company's capital employed, you first need to nail down a consistent, working definition of capital ... Read Full Answer >>
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    The four most common descriptions of capital employed are the total amount of capital that a company utilizes when acquiring ... Read Full Answer >>
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    The compound annual growth rate, or CAGR for short, measures the return on an investment over a certain period of time. Below ... Read Full Answer >>
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